Kaseya may be close to announcing three potential acquisitions. Two of the potential deals can be considered tuck-ins, but one sounds larger and more strategic in nature. ChannelE2E explored those topics and more during a meeting with Kaseya CEO Fred Voccola this week.
Admittedly, there’s a chance the M&A deals won’t get finalized — but Voccola seemed confident multiple transactions are on the near-term horizon. Overall the strategy sounds familiar. The company’s primary focus remains unchanged: Expand a suite of MSP-oriented software that allows service providers to drive more revenue gains.
Kaseya’s portfolio already includes RMM (remote monitoring and management), PSA (professional services automation), network monitoring, cloud management, password management and two-factor authentication software. The company also has relationships with a range of backup, disaster recovery and security companies.
Potential Targets? Unclear…
In recent weeks, MSPs have mentioned fast-growth players like Passportal (password management) and IT Glue (documentation) as two potential industry acquisition targets. Names like BrightGauge and MSP CFO (both offering business intelligence for service providers) have also drawn M&A speculation over the past year or two.
But generally speaking, I don’t think those are the companies Kaseya is currently targeting. Voccola didn’t disclose which MSP market segments the potential acquisitions serve, revealing only that he and the company are “looking at everything through the lens of the MSP.” A third-party source offers this additional clue: Keep your eyes on New England…
Kasesya was an early pioneer in the MSP software market. The company stumbled a bit amid ownership and executive transitions in the 2013 and 2014 timeframe. Private equity owners hired Voccola in mid-2015 to lead the company. His first few months involved stabilizing the business and building key practice areas like a customer success team. By 2016, Kaseya was growing again and back in acquisition mode. One recent tuck-in involves Unigma, which specializes in cloud cost management capabilities across Amazon Web Services, Google Cloud Platform and Microsoft Azure.
M&A Considerations: Lots of Moving Pieces
Kaseya isn’t alone in the M&A market. Key rivals like Autotask, ConnectWise, Continuum and SolarWinds MSP have been exploring or completing M&A deals in recent years. Some sources even suggest Datto has been speaking to potential suitors in recent weeks, though I’d leave that chatter firmly in the rumor column for now.
Overall, lofty valuations — particularly in the business continuity, data protection and security markets — have hindered some M&A negotiations over the past year, multiple sources say.
Still, I sense that the M&A logjam could break soon. Among the anecdotes to track:
Autotask CEO Mark Cattini says his company is willing to make deals as long as the sellers fit several criteria — including pure cloud business models.
SolarWinds MSP executives hinted during recent Australia events that the company was back in acquisition mode. One recent deal involves SpamExperts — though I sense there could be another deal waiting in the wings…
Meanwhile, More Is Brewing at Kaseya
During ChannelE2E’s meetings with Kaseya this week, we also covered how the company has been moving closer to MSPs; recent MSP valuation metrics; and new steps to help partners generate SaaS-oriented revenues — particularly in the security market. We’ll share more details soon.